Daily Report 07 February 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 0.8% lower at the 79 583 level, mainly dragged lower by the resource sector, financial and tech shares.

Sibanye Stillwater said that they have received a key environmental permit for its Keliber lithium mining and processing project in Finland, clearing the way for a facility to supply the European battery market.

Sibanye took control of the Finnish battery chemicals maker Keliber last October when it raised its shareholding to 85%.

Renergen said that three directors have resigned from energy company with immediate effect, citing that the company has moved from an exploration to a production company.

In a trading update from Sasol for the six months ended 31 December 2022, the company said that although the oil price was stronger, refining margins higher and the weaker Rand/US Dollar exchange rate, this was offset by the impact of weaker global economic growth, depressed chemicals prices and higher feedstock and energy costs. Headline earnings per share (HEPS) are expected to be between R29.84 and R31.36, compared to the prior half year HEPS of R15.21 an improvement of more than 95% and earnings per share (EPS) are expected to be between R21.55 and R23.98, compared to the prior half year EPS of R23.98 representing a decrease of between 0% and 10%. Sasol will report its first-half results on the 21^st of  February.

 

SA Economy:

Compli-Serve, the provider of advisory and compliance services to financial firms, said that SA still faces a 60% likelihood of being greylisted, despite President Cyril Ramaphosa signed into law two acts on the 30^th of December in an effort to strengthen the country’s ability to combat financial crime ahead of the Paris-based Financial Action Task Force’s (FATF) February 24^th decision.

The South African Reserve Bank estimated that the ongoing electricity crisis is costing the economy R899 million per day.

President Cyril Ramaphosa will deliver the annual State of the Nation Address in parliament on Thursday and a possible cabinet reshuffle.

 

Global Economy:

China said it strongly condemned US military strike on a balloon that drifted into US airspace, adding that the object was used for meteorological and scientific purposes.

Investors are waiting a crucial speech by U.S. Federal Reserve Chairman Jerome Powell later today to assess the path of future interest rate hikes by the central bank.
Retail sales in the Euro Area declined 2.7% month-over-month in December 2022, following a 1.2% rise in November.

Retail sales in the United Kingdom increased 3.9% on a like-for-like basis in January 2023 from a year ago, decelerating from a 6.5% rise in December.

Investors cautiously awaits Federal Reserve Chair Jerome Powell’s speech at the Economic Club of Washington for further clues about the central bank’s tightening path later today.

 

Global Company:

The FTSE 100 closed 0.83% lower at 7 836, with losses in the financial, property and retail shares.

The Hang Seng Index is higher by 0.69% to 21 366, as pressure by geopolitical tensions between Beijing and Washington eased.

Baidu Inc. shares rose 12.4% on news that they plan to complete internal testing of its ChatGPT-styled project “Ernie Bot” in March.

In China, the Shanghai Composite is up 0.15% to 3 243.

The Dow Jones Industrial Average closed 0.1% lower to 33 891, while the S&P 500 was down 0.62% to 4 111.

Dell Technologies fell 3% after the company announced that they will cut 6 650 jobs as demand for personal computers has declined.

Tyson Foods fell 4.6% after the US meat company said that have missed its earnings expectations.

 

Commodities:

Gold is up 0.18% to $1 866/oz, while Platinum is lower by 0.59% to $966/oz.

Brent crude was 1.3% higher at $80.99 a barrel.

 

Currencies:

The rand traded at R17.62 against the US Dollar, R21.23 against British Pound and R18.93 against the Euro.

The Euro is slightly weaker against the US Dollar to trade at $1.0740.